Wednesday, September 19, 2012

The US voting technology market

Cartoon: John Cole
At this point in time, only a few nations still question the importance of market competition to nurture a challenging environment that stimulates creativity, inventiveness, new processes, new methods, new technologies, and ultimately better products. Over the course of history, and especially during the last century, countries that have implemented market oriented economic reforms have seen substantial economic growth and developed a healthy private sector. 

However, history has also proven that markets do not always work efficiently when left to themselves. Since the early beginning of the oil industry during the last decades of the 19th century, the United States of America understood the need to create a proper framework of policies and legislation to foster the kind of competition that promotes thriving economies. Nowadays the United States' federal government enforces competition through the Antitrust Division of the Department of Justice and the Federal Trade Commission.

The US voting technology market has seen in recent years a worrisome tendency towards industry consolidation. There are two major competitors; ES&S and Dominion Voting, which when combined hold at least 70% of market share. By means of aggressive acquisitions, and propelled by the $ 3.2 billion the US Federal Government infused into the market, these companies have enjoyed unprecedented growth. As a consequence of all of these rearrangements, competition has been significantly reduced and customer freedom of choice hampered. Nowadays there is little innovation, and service quality is far from what election administration deserves.

A study conducted by Lauren Norden in 2010 for the Brennan Center for Justice titled "Voting System Failures" points out dozens of scandals involving some of the most important vendors of voting technology in the US. The grim picture depicted has not changed much since. Just recently, in March 2012, a software glitch by Dominion Voting's platform gave the victory to the wrong candidate.

In the hopes of improving the voting market condition, and expressing antitrust concerns, the U.S. Department of Justice repealed the purchase of Premier Election Solutions (PES) by Election Systems & Software (ES&S) in 2010. PES was later sold to Canadian firm Dominion Voting Inc. In June 2010, Dominion acquired Sequoia Voting Systems and then put that company into bankruptcy after absorbing its proprietary technology. 

At the moment, and despite the Federal Government's efforts, innovation and service quality are lacking due to an uncompetitive market. Hopefully, in the years to come the United States will manage to lower market barriers and promote the healthy competition that has helped to make this country a world economic superpower.